US Lawmakers Reintroduce Bill Targeting Risks of Crypto Adoption

Reintroducing Legislation was first Proposed in 2022.

Two United States Senators, James Risch, and Bob Menendez, have put forth a bill aimed at addressing concerns surrounding El Salvador's adoption of Bitcoin as a legal tender. The Accountability for Cryptocurrency in El Salvador Act resurfaced as a response to the country's Bitcoin Law, which was enacted in September 2021.

On May 11, Senators Risch and Menendez presented the bill, calling for reports to be generated regarding the utilization of cryptocurrency as an accepted form of payment in El Salvador. The move echoes Senator Risch's earlier attempt in February 2022 to introduce similar legislation soon after the implementation of the Bitcoin Law.

Senator Risch's renewed effort is part of a broader initiative to combat the use of cryptocurrency as legal tender, citing potential risks to economic and financial stability, as well as the empowerment of malicious actors. El Salvador officially recognizes Bitcoin alongside the national colon currency and the U.S. dollar as a form of legal payment.

If approved, the bill would mandate various U.S. federal agencies to assess El Salvador's cybersecurity capabilities, financial stability, and how these factors may have influenced the decision to adopt Bitcoin as legal tender. In February, the International Monetary Fund cautioned El Salvador about the potential risks of embracing Bitcoin as a legal currency and its impact on financial integrity and stability.

El Salvador's Bitcoin Law Sparks Controversy and Legislative Debates

The Senate previously passed a version of the Bitcoin-focused legislation through a committee in April 2022. Additionally, a companion bill was introduced in the House of Representatives. However, records indicate that the legislation has not progressed in over a year.

El Salvador's President, Nayib Bukele, responded to the bill's previous introduction by criticizing U.S. lawmakers on Twitter, labeling them as "boomers" and accusing them of interfering in the affairs of a sovereign nation. President Bukele has been instrumental in implementing various pro-crypto policies in El Salvador, including plans to raise funds for the construction of a "Bitcoin city" through BTC-backed bonds.

The reintroduction of the legislation reflects ongoing debates and concerns surrounding the impact of El Salvador's Bitcoin adoption. It highlights the efforts by some U.S. legislators to examine the potential consequences and assess the country's readiness in terms of cybersecurity and financial stability. Meanwhile, President Bukele remains firm in his commitment to advancing crypto-friendly initiatives in El Salvador, despite external scrutiny and opposition.

Also read-  Bakkt Drops Majority of Tokens from Apex Crypto Platform in Delisting Move